I got smacked on this in March. It went down way more than the index's and hasn't come back. What gives? Will it recover, or is it a terrible methodology?

Growth stocks, particularly megacap growth stocks, are very "good," lower-risk stocks that buyers in the market are willing to pay a premium for in anticipation of any number of potential benefits, such as lower risk, long-term growth potential, and stable, positive performance. A value-tilted index by definition takes on more "bad" stocks, i.e., stocks that the market thinks are not as "good" as growth stocks, and the value-tilted index likely excludes or underweights the "good," lower-risk stocks. The value premium, if it exists, comes from its higher risk. Value investors are constantly betting that the market sees it wrong and has mispriced the value stocks chosen by the value investor. This is all to say that "what gives" is you took more risk than you would have if you had just held the market portfolio, and you got burned. But, who knows! Maybe your value-tilted index fund is about to shoot through the roof.

"I am better off than he is – for he knows nothing, and thinks that he knows. I neither know nor think that I know." - Socrates. "Nobody knows nothing." - Jack Bogle

No doubt some stocks are getting more of the downturn. LCś may
recover first. Utilities and LCś probably the safest hopefully the
downturn doesn´t get worse. Earnings not forecast to be good
at all this year.

I'm not a fan because I don't like dividend funds, in part because of their tax inefficiency. For what it's worth, you can go read about the index rather than presuming how it's constructed. Thanks to the odd index construction (equal-weighting of 80 high-yield stocks), SPYD is actually doubly tax-inefficient as the index's turnover encourages capital gain distributions on top of dividends.

Doesn't the issue that you have raised go away if this fund is held in your pre-tax accounts?

I'm not a fan because I don't like dividend funds, in part because of their tax inefficiency. For what it's worth, you can go read about the index rather than presuming how it's constructed. Thanks to the odd index construction (equal-weighting of 80 high-yield stocks), SPYD is actually doubly tax-inefficient as the index's turnover encourages capital gain distributions on top of dividends.

Doesn't the issue that you have raised go away if this fund is held in your pre-tax accounts?

It's trivially true that concerns about an asset's tax-inefficiency go away when holding that asset in a tax-advantaged account.

SPYD has grown from a few 100 million to approaching 2 billion dollars.
Most analysts consider the 500 an excellent source of dividends for an
80 stock sample, especially when the economy is more normal. I'm
not saying make any big stock investment with the economy appearing to
be deflating this year, but it is forecast to be a good tilt in the future
economy.

The 500 actually pays 2% dividend and usually has a payout ratio around 40%.
So being quarantined from dividends is not occurring in the index.

Utility indexes are probably safer and more reliable overall but who really
knows. All stocks are going to really go down if an all out crash occurs.
In a low growth economy in the future a dividend tilt may provide some
very good diversification.

SPYD has grown from a few 100 million to approaching 2 billion dollars.
Most analysts consider the 500 an excellent source of dividends for an
80 stock sample, especially when the economy is more normal.

I'm sure State Street is happy, but no investor in this fund should be. Since inception, it's had lower returns, more volatility, and a max drawdown over twice as large as VIG. It's a crappy fund.

Not chasing dividends is not the same as trying to be "quarantined" from them. Total return is what counts.

The new ETF's from old dividend indexes that actually have better returns than
the 500 have short histories. But analysts realize their potential. I'd show
you some figures but I'm too lazy. I still think utilities are the best tilt for dividends
and SPYD or SPHD a close second. VYM is the largest fish in the pond but past
history doesn't put it above old unused dividend oriented indexes just becoming ETF's
which with a little growth have very good total returns in their past histories.

In this market only past histories of a stable market with any decisions deferred
make sense to me. In a growth or bull market indexes make money not just
total market or dividend indexes. Not today presumably, but whatever is good
is worth waiting for.

Not chasing dividends is not the same as trying to be "quarantined" from them. Total return is what counts.

The new ETF's from old dividend indexes that actually have better returns than
the 500 have short histories. But analysts realize their potential. I'd show
you some figures but I'm too lazy. I still think utilities are the best tilt for dividends
and SPYD or SPHD a close second. VYM is the largest fish in the pond but past
history doesn't put it above old unused dividend oriented indexes just becoming ETF's
which with a little growth have very good total returns in their past histories.

In this market only past histories of a stable market with any decisions deferred
make sense to me. In a growth or bull market indexes make money not just
total market or dividend indexes. Not today presumably, but whatever is good
is worth waiting for.